Gordon, Huber, and Landa: Challenger entry and voter learning
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Gordon, Sanford C., Gregory A. Huber, and Dimitri Landa. 2007. Challenger entry and voter learning. American Political Science Review 2 (May): 303-320.
If, as previous research indicates, high-quality challengers make act strategically when deciding whether to run against a Congressional incumbent, then this decision ought to convey credible information to voters.
As long as voters believe that the challenger actually bears the sort of costs discussed elsewhere (e.g. Jacobson and Kernell 1983), then the challenger's decision conveys information. (This assumption may not hold if, for example, voters think the particular challenger just likes running for office.)
Place in the Literature
This study builds on two fields. First, it seeks to develop our understanding of retrospective voting (Fiorina 1981; Kramer 1971). Second, it contributes to the literature on the incumbency advantage and challenger quality (Cox and Katz 1996; Jacobson and Kernell 1983).
Both voters and challengers learn from each other. If a weak incumbent fails to attract a strong challenger, citizens have reason to go learn more about the incumbent. Likewise, if a strong incumbent attracts a strong challenger, voters have reason to reconsider the incumbent's performance. Meanwhile, the voter's process of gaining political information can, in turn, affect the challenger's entry calculus.
Thus, voters and challengers interact with one another.
None. This is purely a formal model.